APPRAISAL REPORT OF: A 78.30 ACRE TRACT – AS IF VACANT AT MONTANA HIGHWAY 83 CONDON, MONTANA PREPARED FOR: Ms. Emily Cooper, Land Sections Supervisor State of Montana Department of Natural Resources and Conservation Trust Land Management Division P.O. Box 201601 Helena, Montana 59620-1601 MARKET VALUE AS OF: April 12, 2017 PREPARED BY: Elliott M. Clark, MAI & Christopher D. Clark Clark Real Estate Appraisal 704-C East 13th Street, #509 Whitefish, Montana 59937 (406) 862-8151 704-C East 13th Street, #509 Whitefish, Montana 59937 LETTER OF TRANSMITTAL May 11, 2017 Ms. Emily Cooper, Land Sections Supervisor State of Montana Department of Natural Resources and Conservation Trust Land Management Division P.O. Box 201601 Helena, Montana 59620-1601 Re: Appraisal Report of Real Property Identified as Swan Valley Retreat, Condon, Montana (As If Vacant) Dear Ms. Cooper: In compliance with your request Elliott M. Clark, MAI and Christopher D. Clark with Clark Real Estate Appraisal viewed the above referenced property on April 12, 2017 accompanied by Mr. Claude Cassidy, Ms. Emily Cooper, and Ms. Chloe Katsilas all with the Montana DNRC. We reviewed applicable information regarding zoning, and researched and analyzed trends in real estate activity in the immediate and greater subject market area. The property viewing, reviews, and analyses were made in order to prepare the attached appraisal report in a summary format. We were requested by the client to provide an opinion of value for the subject property As If Vacant. For that reason, the value concluded in this report is based upon the Hypothetical Condition that the property was vacant as of the report effective date. Please see additional Hypothetical Conditions and one Extraordinary Assumption included in the Scope of Work. There are three approaches to value in the appraisal of real property. They are the Cost, Sales Comparison, and Income Approaches. All three approaches and their applicability will be discussed in greater detail in the Scope of the Appraisal and The Appraisal Process sections of this report. The value conclusion was made after thorough study of available market data and other data felt to be pertinent to this appraisal. The attached appraisal report exhibits the factual data found and reasoning used in forming our opinion of value for the subject property. The value conclusion is based on the assumption that all necessary governmental approvals have been obtained and will be maintained, and that the property owners will exhibit sound management and sales practices. Telephone (406) 862-8151 www.clarkappraisal.us Clark Real Estate Appraisal (17-020ec) (04/12/2017) 2 We were not provided with soil studies for the subject property. We assume that the soils are capable of supporting construction similar to that in the neighborhood without unusual soil preparation. We are not aware of the presence of any hazardous material, groundwater contamination, or toxic materials that may be on or in the subject property. Should any of these conditions be present, the value concluded in this report could be affected. We certify that, to the best of our knowledge and belief, the statements and opinions contained in this appraisal report are full, true, and correct. We certify that we have no interest in the subject property and that neither the employment to make this appraisal nor the compensation is contingent upon the value estimate for the property. This appraisal assignment was not made nor was the appraisal rendered on the basis of a requested minimum valuation or specific valuation. This appraisal is subject to the attached Certification of Appraisal and General Assumptions and Limiting Conditions. We further certify that this appraisal was made in conformity with the requirements of the Code of Professional Ethics of the Appraisal Institute and the Uniform Standards of Professional Appraisal Practice of the Appraisal Foundation (USPAP). Respectfully submitted, Elliott M. Clark, MAI Montana Certified General Real Estate Appraiser REA-RAG-LIC-683 Christopher D. Clark Montana Licensed Real Estate Appraiser REA-RAL-LIC-841 17-020ec Telephone (406) 862-8151 www.clarkappraisal.us Clark Real Estate Appraisal (17-020ec) (04/12/2017) 3 TABLE OF CONTENTS LETTER OF TRANSMITTAL ................................................................................................................. 2 SUMMARY OF SALIENT DATA AND CONCLUSIONS .................................................................... 5 CERTIFICATION OF APPRAISAL ........................................................................................................ 6 GENERAL ASSUMPTIONS AND LIMITING CONDITIONS ............................................................ 8 SCOPE OF THE APPRAISAL ............................................................................................................... 10 IDENTIFICATION OF THE SUBJECT PROPERTY......................................................................... 13 DATE OF PROPERTY VIEWING ........................................................................................................ 13 EFFECTIVE DATE OF MARKET VALUE ......................................................................................... 13 PURPOSE OF THE APPRAISAL .......................................................................................................... 13 PROPERTY RIGHTS APPRAISED ...................................................................................................... 13 INTENDED USE & INTENDED USER OF THE APPRAISAL ......................................................... 14 DEFINITION OF MARKET VALUE .................................................................................................... 14 HISTORY OF SUBJECT PROPERTY & STATEMENT OF OWNERSHIP ................................... 14 PROPERTY DESCRIPTION .................................................................................................................. 15 A. GENERAL SITE DESCRIPTION ...................................................................................................................... 15 B. ACCESS .............................................................................................................................................................. 15 C. IMPROVEMENTS ............................................................................................................................................. 16 D. EASEMENTS, BUFFERS AND RESTRICTIONS ............................................................................................ 19 E. TOPOGRAPHY, VEGETATION, WETLANDS, SOILS AND DRAINAGE .................................................... 19 F. ZONING .............................................................................................................................................................. 19 G. ASSESSMENT & TAXES.................................................................................................................................. 20 H. UTILITIES .......................................................................................................................................................... 20 I. ENVIRONMENTAL CONSIDERATIONS ........................................................................................................ 20 J. PUBLIC SAFETY AND SERVICES ................................................................................................................... 21 K. SITE SUITABILITY .......................................................................................................................................... 21 SUBJECT PHOTOGRAPHS................................................................................................................... 34 SUBJECT MARKET ANALYSIS – AS IF VACANT .......................................................................... 39 HIGHEST AND BEST USE .................................................................................................................... 42 THE APPRAISAL PROCESS ................................................................................................................. 44 SALES COMPARISON APPROACH .................................................................................................... 45 RECONCILIATION OF VALUE INDICATIONS ............................................................................... 54 COST ESTMIATE FOR SEWER & WASTE WATER SYSTEM ...................................................... 55 QUALIFICATIONS OF THE APPRAISERS ....................................................................................... 56 APPRAISERS LICENSES ....................................................................................................................... 59 ADDENDUM ............................................................................................................................................. 60 NATIONAL ECONOMIC DATA ........................................................................................................................... 61 STATE ECONOMIC DATA ................................................................................................................................... 61 LAKE COUNTY ..................................................................................................................................................... 62 SEELEY-SWAN VALLEY DATA ........................................................................................................................